Buy Titan, target price Rs 1400: Motilal Oswal

Motilal Oswal has given a buy rating to Titan Company with a target price of Rs 1400. The share price moved down by 3.24 per cent from its previous close of Rs 1217.90. The stock’s last traded price is Rs 1178.50.

Titan Company Ltd., incorporated in the year 1984, is a Large Cap company (having a market cap of Rs 108043.58 Crore) operating in Gems and Jewellery sector.

Financials
For the quarter ended 30-09-2020, the company reported a Consolidated sales of Rs 4127.00 Crore, up 201.68 % from last quarter Sales of Rs 1368.00 Crore and down -10.30 % from last year same quarter Sales of Rs 4600.71 Crore. Company reported net profit after tax of Rs 174.00 Crore in latest quarter.

Investment Rationale
While FY22E multiples at 55x may appear expensive, it is primarily due to temporary impact of the pandemic in FY21, from which the rebound would be sharp over the next couple of years. The brokerage maintains Buy with TP of INR1,400 (55x Sep’22 EPS).

Promoter/FII Holdings
Promoters held 52.9 per cent stake in the company as of Sept 30, 2020, while FIIs held 18.1 per cent, DIIs 11.3 per cent and public and other 17.7 per cent.